Somebody's Watching Me
As of 1-1-12, phase two reporting, Mutual Fund transactions, are now being tracked and will be reported to the IRS next year. This continues the multi-step phase in of mandatory tax reporting created by the Emergency Stabilization Act of 2008.
Last year, we resurrected “Rockwell’s” one hit wonder and wrote a “Somebody’s Watching Me” article to announce the first phase, US Government stock transaction reporting, which became law 1-1-11.
As the transition phase continues, there will be discrepancies. We expect soon to be sent tax cost basis reporting from our custodial vendor for 2011 to have inaccuracies (ONLY STOCK TRANSACTIONS HAVE BEEN REPORTED TO THE IRS FOR 2011.) We will be sending our firm’s regular realized gains and loss report which has the most accurate and long-term basis reporting along with reminder instructions.
As time passes we expect the convergence of tax reporting and accuracy, however, not for several years. We do believe these reporting requirements are good, and the new law was long overdue, as technology now easily allows for such tracking. The transition period will have a few bumps, but for the long-term, the equal playing field established for all tax payers, and the long-term benefit to us as taxpayers, is well worth the interim hiccups.
Have a Great Day!
JK
214-706-4300
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